COP28: Malaysia is eligible for loss and damage fund
KUALA LUMPUR - Malaysia, as a developing country, is eligible for the Loss and Damage (L&D) Fund, which was adopted at the 28th Conference of the Parties of the United Nations Framework Convention on Climate Change (COP28), in Dubai, United Arab Emirates (UAE) to help compensate vulnerable countries coping with loss and damage caused by climate change.
Although Malaysia is not listed as a country to benefit from the L&D Fund for now, it should review its criteria to gain access to this specific fund, said climate finance policy analyst Muhammad Shaqib Shahrilnizam.
This could help to reduce dependency on government budgetary expenditure, especially during hazards and natural disasters caused by climate change, he said.
"Malaysia is supposed to be listed among the L&D countries since its society and economy are affected by heavy floods especially in recent years,” he told Bernama in an interview.
He also noted on the economic benefits that Malaysia can gain if given access to the fund, including providing economic value for the local companies, International Climate Finance (ICF), Development finance institutions (DFIs) and others to invest on L&D projects in the country.
"This can open up an idea to push a L&D framework plan for Malaysia before we can get access to the global L&D fund," he said.
Nearly 200 countries have collectively pledged more than US$400 million to establish the L&D fund to support vulnerable countries to cope with climate disaster on the first day of the UN Climate summit in Dubai, UAE, on Thursday.
Several countries, led by the UAE, made their financial commitments to the fund, with the UAE contributing US$100 million, Germany with US$100 million, United Kingdom with £40 million (about US$50.6 million) and £20 million for other arrangements, Japan with US$10 million, and the United States with US$17.5 million.
In making the announcement, COP28 president Sultan Ahmed Al-Jaber said the fund will support "billions of people, lives, and livelihoods particularly vulnerable to the adverse effects of climate change”.
L&D Fund will help countries prepare communities for the climate impacts that is already occurring, as well as deal with the inevitable losses, like floods and landslides.
In the local context, Malaysia has seen heavy rainfalls that caused floods and landslides every year, which most observers said deforestation and climate change were the main causes of these natural disasters.
Muhammad Shaqib, who is also a former Global Youth Focal Point on Climate Finance to United Nations Framework Convention on Climate Change, described this decision as a huge achievement under the UAE as the COP28 presidency this year.
"We expected it to be done at the end of COP28 but we are kind of surprised it was passed on the first day," he said.
Third World Network (TWN) Executive Director, Chee Yoke Ling, in welcoming the decision said the L&D Fund is a victory for many developing countries of the G77, after many years of struggle to call for concrete commitment from developed countries to help address climate change issues in these countries.
TWN is an independent non-profit international research and advocacy organisation involved in issues relating to development, developing countries, and North-South affairs.
She stated that, as a developing country, Malaysia is eligible and should assess the national loss and damage needs that can be supported by the new fund.
"However, Malaysia should really figure out what that (L&D) means at the national level for us to work on this.
This is because L&D is not only within one particular ministry, but also the L&D impact across the entire national economy, from building technology to development and other activities," she said.
The L&D Fund, established at COP27 in Egypt in 2022, has been a long-standing demand of developing nations coping with the cost of devastation caused by ever-increasing extreme weather events such as droughts, floods, and rising sea levels.
On Friday, during the launch of the Malaysia Pavilion at COP28, Natural Resources, Environment and Climate Change (NRECC) Minister Nik Nazmi Nik Ahmad said Malaysia acknowledges the UAE's pivotal role at COP28, expressing hope for successful negotiations and envisioning a strong collaborative stance on climate-related matters.
Nik Nazmi said to ensure the L&D fund's transparent and equitable oversight is paramount, the fund must remain a politics-free tool for climate action, swiftly supporting developing nations.
The Malaysian delegation for the COP28 this year has registered the largest participation of 600 delegates, according to NRECC. - BERNAMA